Business

Ecobank bags $478m profit before tax

The Ecobank Group has said it bagged $478 million as profit before tax for the full year 2021, according to its audited report.

This represents an increase of 174%.

Also, it recorded ROTE of 19.0%, TBVPS of 5.70 US cents, and Diluted EPS of 1.063 US cents.

The Group also announced a proposed dividend per ordinary share of 0.16 US cents ($0.0016).

The CEO of the Group, Ade Adeyemi, said 2021 proved to be a transformational year for Ecobank.

“The Bank made significant progress with its strategic priorities and delivered strong business and financial returns. We grew revenues, remained efficient, improved credit quality, strengthened the balance sheet and, for the first time since 2016, our Board has recommended the payment of dividends to shareholders”, he said.

“We increased profit before tax by $140 million to $478 million, after adjusting for the $164 million goodwill charge in 2020 and generated a record return on tangible shareholders’ equity of 19%. Net revenues were $1.8 billion, up 5%, benefiting from our diversified operating model and the continued focus on growing our trade finance, payments, fixed income, currencies, and commodities businesses. Furthermore, the efficiency ratio of 58.9% was the best in over a decade,” Ayeyemi said.

“Credit quality continues to be particularly strong, with non-performing loans at a historic low of 6.2% of total loans and a reduction in the concentration risk of the credit portfolio. Moreover, we proactively built provision reserves to above 100% of non-performing loans. In addition, deposit growth was robust, increasing by $1.4 billion, or 8%, which significantly boosted liquidity and supported our modest loan growth. The investments in pivoting Ecobank as a credible enabler of economic activity for households, businesses and governments in Africa strengthened our optimism for 2022 and beyond, while complementing the expectation of a strong global economic recovery following the easing of Covid-19 restrictions”.

“However, a word of caution following two critical global setbacks: IMF’s cut of global growth forecast, in a high inflation environment with about 60% of lowincome countries in or at risk of ‘debt distress’; and Russia’s recent invasion of Ukraine. In this mix, African economies hang in the balance as contagion risks spread, US Fed and other developed-world central banks hike interest rates, energy prices soar, and geopolitical tensions exacerbate inflation and supply chain bottlenecks”.

“Already the reverberations from these developments have forced some central banks in Africa to hike rates, as prices of goods and services soar and currencies are under pressure, all with security implications. In all this turmoil, we at Ecobank remain highly focused on conducting our business responsibly, observing ESG principles, and discharging our investment in the Ecobank Foundation. We will continue to be aggressive in driving our strategic priorities, leading with technology, and serving our clients and communities”.

“Finally, I want to thank all Ecobankers for their unwavering commitment to realising our vision and remaining the bank that Africa and friends of Africa trust.”

Source: Classfmonline.com

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